Main overnight story? Weak European PMI. This is the chart making the rounds (and it caused SPX futures to sell off from their overnight highs):
European growth showing no signs of picking up. Earnings commentary has been confirming this data, as companies have frequently cited Europe as a weak region with little sign of a bounce.
The Federal Reserve’s press release will be at 2:15 pm EDT today. After an almost 20% rally this year, this market can’t seem to buy a bucket this month. We normally rally into Fed day. But the market is down 3% in the last 3 days, and SPX futures are only up 0.2% this morning.
Earnings is THE story. They’ve been terrible. And that’s despite analysts slashing expectations each week leading into the reports. At this juncture, with nerves on edge, any long positions better offer real value. Little tolerance among investors for sentiment bets.
Markets overnight:
- Asia performed well in spite of European and U.S. weakness. Most markets were down, but less than 1%, and Hong Kong and China both closed higher.
- Weak PMI and German confidence data hit European shares shortly after the open, but they’re back in the green, +0.5%. Europe has been down 3 straight days, so feels like an oversold bounce.
- Commodities close to flat, and the dollar is mixed. The Euro is lower, while Aussie dollar and British pound are higher. Treasury bonds slightly lower.
- MBA mortgage applications down 12%, the lowest reading in about a year. Preliminary US PMI released at 8:58 am EDT, and New Home Sales at 10am
- FB reported a slight beat, and 2 upgrades this morning. Stock up 15% pre-market. NFLX reported concerning subscriber and cost trends, and is trading down about 17% pre-market. VMW flat, and EMC down 4% after cutting forecasts for the year.